Board of Ed Votes to Oppose Measure O

Wading into an election issue, the Beverly Hills Board of Education on Tuesday voted to oppose Measure O, an oil and gas extraction tax on the March 8 ballot.

The Beverly Hills Unified School District would be affected by the tax because it earns royalties on oil and gas extracted from its school campuses. The royalties vary based on the amount of oil produced and the market price of the oil; the district earned almost $758,000 last year from the royalties and $1.1 million the year before.  Much of the royalties come from an oil well on the high school campus operated by Venoco Inc.

According to the ballot mailed to residents, the current oil tax would rise to $2,000 per well plus 2.5 percent of the gross receipts from the sale of oil and natural gas extracted from the city. This represents a 500 percent increase in the tax, according to an argument against the measure printed in the ballot. The current tax rate for wells located in Beverly Hills is $3,880.60 for the first 10,000 barrels of oil produced and 36 cents per additional barrel. Wells located only partly in the city pay a lower rate.

“There are so many sources of hits to our budget now, we don’t need any more,” said school board President Lisa Korbatov, who spoke out against the measure last week to the City Council.

Most of the board members complained that Measure O was put on the ballot without any consultation from the city. Four members voted to oppose the measure, with Myra Lurie abstaining because she receives royalties from mineral rights associated with her property. Board Vice President Brian Goldberg and fellow member Jake Manaster also receive such royalties, but neither felt it precluded them from voting on the matter.

In her remarks to the council, Korbatov said she was concerned that the tax would take money away from the BHUSD in the form of a pass-through tax. In a follow-up letter to the editor in the Beverly Hills Courier, she asked the council to consider a resolution to repeal Measure O if it passes. She said she was speaking as a private citizen and not on behalf of the board, which at that time had not discussed the measure.

But her colleagues clearly agree with her concerns.

"This tax has been under consideration for a number of years … there was a rush to put this on the ballot because of another city doing so,” said board member Jake Manaster, referring to the fact that Los Angeles also has an oil tax on its March 8 ballot. “It is hard to support something that could cause [BHUSD] budget cuts.”

Voicing support of the board's decision is the "No on Measure O” coalition.

“It is good to see the board willing to inform the public about the misleading city information [regarding Measure O],” said Scott MacDonald, the coalition's spokesman. No on Measure O is sponsored by the California Independent Petroleum Association, with funding by Venoco Inc. and Hillcrest Beverly Oil.

At a news briefing attended by Patch earlier this month, city officials said Measure O's impact on the school district would be minimal and that it would bring in about $1 million in additional revenue for Beverly Hills if it passes. This columnist is glad to see the school board highlight the effects of Measure O. There is no mention of how the measure would adversely affect BHUSD in the ballot information.